How to Evaluate ICOs? What to Look for & Avoid [September 2023]

Categorized as Crypto News
How to Evaluate ICOs

The enthusiasm for cryptocurrencies is at an all-time high, and the trend is expected to continue to grow exponentially this year. Bitcoin evangelists continue to encourage people to buy bitcoins, and the results are clear. Last year, the popular trading platform Coinbase crashed because it couldn’t handle the large volume of bitcoin transactions when the value rose to $19,000 per bitcoin.

There’s no doubt that investing in crypto assets can be profitable. If you want to make a lot of money like early bitcoin adopters did, you need to think beyond Bitcoin. There are hundreds of ICO opportunities available on the internet, each with a unique idea and seeking crowdfunding to realize their vision. You never know how to evaluate ICOs that can make you a millionaire.

However, not everything that seems too good to be true is without its flaws. Last year’s figures show that 46% of the ICOs launched in 2017 were scams or ran away with investors’ hard-earned money. It’s important to make an educated and well-informed decision when investing in blockchain projects.

You might be tempted to buy a token that costs less than a dollar or even a cent. Things can be tempting, but before investing, make sure that the Initial Coin Offering (ICO) meets all of the conditions listed below or scores at least 8 out of 10.

buy gnc

Understand How ICO Works?

When a company has a revolutionary idea but lacks the funds to complete it, it can raise an ICO for crowdfunding. In an ICO, tokens or coins are created and destroyed using a blockchain platform such as Ethereum. The company offers these coins to investors or the public for purchase using fiat currencies or virtual currencies like BTC, ETH, etc.

The process typically involves the following steps:

  1. The founders announce the Initial Coin Offering (ICO) dates and the idea behind the project.
  2. The ICO may include pre-sales, also known as pre-ICO.
  3. A demo or alpha version is launched.
  4. Hype is built on social media platforms and crypto-communities.
  5. People buy tokens, and the value of the tokens after the ICO depends on the performance of the company.

The goal of this process is to raise awareness of the ICO or token sale and gain worldwide recognition for maximum participation.

So, how do you decide whether to invest in an ICO? How can you be sure that the company will fulfill its promises and perform well? Let’s take a look…


Best Way to Evaluate ICOs

Here we provide a step-by-step guide to know how to evaluate ICOs in 2023.

  1. Evaluate the Company

It’s important to understand who is behind the company and what their idea and motivation for entering the blockchain game is. 90% of these companies are startups, but they often have the backing of veterans and well-known entrepreneurs and advisors.

The first step is to verify the company’s team portfolio. You can do this by exploring online or social media platforms such as Facebook and LinkedIn to learn about the technical and business experts behind the company. Make sure that the team has a good balance between business trends and technical advancements.

If the company is already established, verifying its credibility and track record can help you make an informed decision. A good company will always share the names of its team members on its website, whitepaper, or both.

  1. Analyze the White Paper

Analyzing the whitepaper is an important step when evaluating ICOs (Initial Coin Offerings). The whitepaper provides detailed information about the company’s idea, roadmap, and target market. It’s important to carefully read the whitepaper to understand the company’s vision and plans for the future.

When analyzing the whitepaper, make sure that the idea presented is innovative, feasible, and well-defined. The whitepaper should clearly explain how the company plans to achieve its goals and what sets it apart from its competitors. It should also provide information about the target market and how the company plans to reach its audience.

By carefully analyzing the whitepaper, you can gain a better understanding of the company’s idea and determine if it’s worth investing in. 

  1. Do research about Idea

Does the Idea Really Resonate with Blockchain?: Carefully examine the company’s idea and ask yourself if it really needs a blockchain solution. Developing a blockchain can be intimidating and expensive, and poor coding can cause the project to crash or leave security loopholes.

The reason for investing in blockchain must be well-justified. If there is a cheaper alternative solution available, why is the company choosing to use blockchain?

  1. Market Scenario and Competitors

It’s important to carefully analyze the whitepaper, including the target audience and market. Is the blockchain project offering something innovative and useful to humanity? The idea should be new and feasible, and the whitepaper should have a well-defined roadmap with clear milestones.

In some markets, such as cybersecurity, healthcare, and financial services, a lot of progress has already been made. If your company’s prospects are in these domains, consider what new offerings they have. The project should not favor obsolete technologies and should have a fair chance of competing against its competitors.

  1. Utilization of Funds

When analyzing the funding structure, take a closer look at any previous investments and investors. Make sure that the company is not completely dependent on the token sale for its development and that it can still function even if it doesn’t reach its hard cap.

Examine the investments and token distribution carefully. Ensure that a substantial share has been allocated to development work and less to bounties and founders.

It’s generally better to invest in capped ICOs, as investing in an open cap ICO may not yield good returns. The most important thing to consider is whether you are happy with the fund distribution. If so, you can move on to the next factor.

  1. Communicating with the Crypto Community

A good website will clearly display the key points from the whitepaper on its website. The company should also use communication channels such as Medium or Twitter to share updates about the project with the public.

In addition, there are various crypto discussion forums such as Bitcointalk, Cryptocompare, Bitcoinforum, and Altcointalks. Take a look at the comments and see what experts are saying about the ICO. If you can’t find your ICO on any of the top websites, it may be cause for concern.

Reasons to Reject an ICO at First Glance

Here are some reasons to reject an ICO at first glance:

  1. No White Paper

If the company doesn’t have a whitepaper, this is a red flag. A whitepaper is essential for understanding the company’s idea and roadmap.

  1. Poorly Written content on the website and in Whitepaper

If the company does have a whitepaper, make sure to read it carefully and get a feel for the idea. The whitepaper should have a well-defined roadmap and include the names of the founders and advisors. If it doesn’t, it may be best to look for another ICO.

  1. No Prototype

If the company doesn’t have a prototype or demo version to show, this may indicate that they aren’t serious about their product. They should be able to share their proof of concept.

Some Key Takeaways

When investing in cryptocurrencies, it’s important to thoroughly research any potential investment before making a decision. Cryptocurrency investments can be irrecoverable in the event of a scam, fraud, or theft, so it’s important to be extra cautious before making any investments. Here are some key takeaways to keep in mind:

  • Don’t buy from unlicensed sellers: It’s important to only buy cryptocurrencies from licensed and reputable sellers to avoid falling victim to scams or fraud.
  • Avoid unsolicited deals or offers: Be wary of unsolicited deals or offers, as they may be too good to be true and could potentially be scams.
  • Be cautious when an ICO seems too good to be true: No one is perfect, so always be cautious when an ICO seems too good to be true. Make sure to thoroughly research the ICO and its team before investing.
  • Don’t invest in uncapped or untimed ICOs: It’s generally better to invest in capped and timed ICOs, as they provide more transparency and accountability.

By following these tips and doing your due diligence, you can make informed decisions when investing in cryptocurrencies.

Looking for Good ICOs?

If you are looking for a good ICO to invest in, then we will suggest you visit  Gerino is a top trading platform with its own cryptocurrency, GNC. The project has a proper whitepaper, roadmap, and future plan.

The project basically provides access to wealth-building opportunities through mainstream cryptocurrencies. With an experienced team, a good plan, and your support the project is moving toward its goal.

GNC is considered one of the best cryptos under $1 in 2023 by many. It offers protection against inflation and removes barriers to entry into capital markets. By joining Gerino, you can participate in the global economy with equal opportunity.

By Gerino Team

The Gerino Team brings together a highly skilled and diverse group of professionals, each with their unique qualifications and expertise. As IT administrators, they possess a deep understanding of information technology systems, ensuring that projects are seamlessly integrated and operate efficiently.

Leave a comment

Your email address will not be published. Required fields are marked *